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TURKEY LAUNCHES WORK ON $10 BN PIPELINE TO PUMP AZERI GAS TO EUROPE
Aquila Style, Singapore
March 18 2015
By Fulya OZERKAN / Stuart WILLIAMS in Istanbul
Turkey and Azerbaijan on Tuesday formally began construction on a
new gas pipeline costing $10 billion which will pump gas from the
vast Azerbaijani Shah Deniz 2 field across Anatolia to Turkish and
EU consumers.
Turkish President Recep Tayyip Erdogan, Azerbaijani counterpart Ilham
Aliyev and Georgian President Giorgi Margvelashvili simultaneously
pushed three buttons to launch work at the eastern end of the pipeline
in the ceremony in the Kars region of eastern Turkey.
"In the name of God!" said the pious Erdogan as he pushed the button
to the booming sound of the theme music from the film "Pirates of
the Caribbean" in the televised ceremony.
The EU, whose energy commissioner Maros Sefcovic was at the ceremony,
is backing the project as part of its Southern Corridor policy to
bring gas from new eastern markets and reduce dependence on Russia
for supplies.
The 1,850 kilometre (1,150 mile) Trans-Anatolian Natural Gas Pipeline
(TANAP) pipeline -- which is due to be completed in 2018 -- is to link
up to the existing South Caucasus Pipeline (SCP) which links Turkey
to the Azerbaijani gas fields in the Caspian Sea through Georgia.
The backers of the project expect that the TANAP will then link up with
the planned Trans-Adriatic Pipeline (TAP) that will bring the gas from
western Turkey to Greece, Albania and across the Adriatic to Italy.
Project of peace
The pipelines avoid Armenia, with whom Azerbaijan and Turkey have
frozen ties due to the Nagorny-Karabakh conflict and the dispute over
the mass killings of Armenians in World War I.
But Erdogan said the pipeline would not only carry Shah Deniz gas to
Europe but also "carry peace".
"Oil and natural gas projects are unfortunately associated in the world
with conflicts, competitions, fights, wars and exploitation. I believe
that this project will be remembered with peace and welfare," he said.
He confirmed the project would cost $10 billion, far more than when
it was originally conceived in 2012.
According to the partnership agreement signed last week, Azerbaijan's
state energy firm SOCAR and Turkey's Botas will hold 58 percent and
30 percent stakes respectively while British energy giant BP has a
12 percent share.
"Without TANAP you cannot get Azerbaijani gas across Turkey," said
Laurent Ruseckas, senior advisor in global gas at IHS Energy in London.
"The development of Shah Deniz 2 depends on getting all the pipelines
from the Caspian Sea to Italy built and a big part of that is TANAP."
Small share of overall market
The total investment in Shah Deniz 2, including the cost of the
pipeline infrastructure, is $40-45 billion.
The field will have 16 billion cubic metres (bcm) of gas production per
year with 6 bcm pumped to Turkish consumers and 10 bcm sent to Europe.
"This is a small share of the overall market," commented Ruseckas,
who projects total consumption this year in the EU at 444 bcm.
Erdogan said annual volumes would eventually increase to a capacity
of shipping 22 bcm and subsequently 31 bcm.
However Turkey, whose relations with Moscow have warmed considerably
in recent years, is also talking with Russia on a new Turkish Stream
pipeline that will pump Russian gas under the Black Sea to its
territory and Europe.
The Turkish Stream pipeline is aimed at replacing Russia's South
Stream project for pumping gas to Europe avoiding Ukraine, which
President Vladimir Putin dramatically pulled last year citing a lack
of cooperation from the EU.
Russia has expressed doubts about the TANAP project with its envoy to
the European Union Vladimir Chizov saying it was "extremely challenging
from a technical point of view" and "exorbitantly expensive".
However Turkish Energy Minister Taner Yildiz said that TANAP was not a
rival to Turkish Stream, whose final terms are still being negotiated
with Russia.
"TANAP should not contradict Turkish Stream because these two
projects intend to carry gas from two different sources -- Russia
and Azerbaijan," said Chi-Kong Chyong at the European Council on
Foreign Relations.
http://www.aquila-style.com/focus-points/global-snapshots/turkey-launches-work-on-10-bn-pipeline-to-pump-azeri-gas-to-europe/96116/
Aquila Style, Singapore
March 18 2015
By Fulya OZERKAN / Stuart WILLIAMS in Istanbul
Turkey and Azerbaijan on Tuesday formally began construction on a
new gas pipeline costing $10 billion which will pump gas from the
vast Azerbaijani Shah Deniz 2 field across Anatolia to Turkish and
EU consumers.
Turkish President Recep Tayyip Erdogan, Azerbaijani counterpart Ilham
Aliyev and Georgian President Giorgi Margvelashvili simultaneously
pushed three buttons to launch work at the eastern end of the pipeline
in the ceremony in the Kars region of eastern Turkey.
"In the name of God!" said the pious Erdogan as he pushed the button
to the booming sound of the theme music from the film "Pirates of
the Caribbean" in the televised ceremony.
The EU, whose energy commissioner Maros Sefcovic was at the ceremony,
is backing the project as part of its Southern Corridor policy to
bring gas from new eastern markets and reduce dependence on Russia
for supplies.
The 1,850 kilometre (1,150 mile) Trans-Anatolian Natural Gas Pipeline
(TANAP) pipeline -- which is due to be completed in 2018 -- is to link
up to the existing South Caucasus Pipeline (SCP) which links Turkey
to the Azerbaijani gas fields in the Caspian Sea through Georgia.
The backers of the project expect that the TANAP will then link up with
the planned Trans-Adriatic Pipeline (TAP) that will bring the gas from
western Turkey to Greece, Albania and across the Adriatic to Italy.
Project of peace
The pipelines avoid Armenia, with whom Azerbaijan and Turkey have
frozen ties due to the Nagorny-Karabakh conflict and the dispute over
the mass killings of Armenians in World War I.
But Erdogan said the pipeline would not only carry Shah Deniz gas to
Europe but also "carry peace".
"Oil and natural gas projects are unfortunately associated in the world
with conflicts, competitions, fights, wars and exploitation. I believe
that this project will be remembered with peace and welfare," he said.
He confirmed the project would cost $10 billion, far more than when
it was originally conceived in 2012.
According to the partnership agreement signed last week, Azerbaijan's
state energy firm SOCAR and Turkey's Botas will hold 58 percent and
30 percent stakes respectively while British energy giant BP has a
12 percent share.
"Without TANAP you cannot get Azerbaijani gas across Turkey," said
Laurent Ruseckas, senior advisor in global gas at IHS Energy in London.
"The development of Shah Deniz 2 depends on getting all the pipelines
from the Caspian Sea to Italy built and a big part of that is TANAP."
Small share of overall market
The total investment in Shah Deniz 2, including the cost of the
pipeline infrastructure, is $40-45 billion.
The field will have 16 billion cubic metres (bcm) of gas production per
year with 6 bcm pumped to Turkish consumers and 10 bcm sent to Europe.
"This is a small share of the overall market," commented Ruseckas,
who projects total consumption this year in the EU at 444 bcm.
Erdogan said annual volumes would eventually increase to a capacity
of shipping 22 bcm and subsequently 31 bcm.
However Turkey, whose relations with Moscow have warmed considerably
in recent years, is also talking with Russia on a new Turkish Stream
pipeline that will pump Russian gas under the Black Sea to its
territory and Europe.
The Turkish Stream pipeline is aimed at replacing Russia's South
Stream project for pumping gas to Europe avoiding Ukraine, which
President Vladimir Putin dramatically pulled last year citing a lack
of cooperation from the EU.
Russia has expressed doubts about the TANAP project with its envoy to
the European Union Vladimir Chizov saying it was "extremely challenging
from a technical point of view" and "exorbitantly expensive".
However Turkish Energy Minister Taner Yildiz said that TANAP was not a
rival to Turkish Stream, whose final terms are still being negotiated
with Russia.
"TANAP should not contradict Turkish Stream because these two
projects intend to carry gas from two different sources -- Russia
and Azerbaijan," said Chi-Kong Chyong at the European Council on
Foreign Relations.
http://www.aquila-style.com/focus-points/global-snapshots/turkey-launches-work-on-10-bn-pipeline-to-pump-azeri-gas-to-europe/96116/